1T E N E T

Update on TENET

Duncan MartinCEO: TENET

iWeek15 -17 September 2010

2T E N E T

What is TENET?

• Non-profit (Section 21 company)

• Operates the South African NREN– Currently: 96 campuses of 46 institutions– Some remote campuses serviced by Telkom

• Recovers costs from institutions– Around R130m per year– No donations or government grants

• Member of ISPA– Settlement-free peering at CINX and JINX

3T E N E T

International b/w cost to institutions

Start Date PlatformChargeper Mbps

Bandwidth ratio

2001-03-01 Satellite R 52,425 0.29

2003-08-25 SAT-3 R 60,545 0.25

2005-08-25 SAT-3 R 21,428 0.70

2006-08-10 SAT-3 R 20,184 0.75

2007-04-01 SAT-3 R 21,025 0.72

2008-01-01 SAT-3 R 15,045 1.002008-06-01 SAT-3 R 14,245 1.06

2009-10-01 SAT-3 R 13,375 1,12

2010-01-01 SEACOM R 1,380 10.9

4T E N E T

International b/w history

QuarterMbps ordered by

institutions

2008 Q3 228

2008 Q4 241

2009 Q1 246

2009 Q2 247

2009 Q3 254

2009 Q4 329

2010 Q1 427

2010 Q2 1907

2010 Q3 2020

2011 Q3 6000 ?

5T E N E T

This is thanks to…

• UbuntuNet’s formation and London ops

• SEACOM’s special 10 Gbps deal for TENET

• DST’s SANReN backbone deployment

• ICASA’s issuing of ECNS and ECS licenses– Following Altech Autopage Cellular’s celebrated

court cases

However: high capacity backhaul still has to reach many campuses

6T E N E T

What is UbuntuNet?

7T E N E T

UbuntuNet Alliance for Research and Education Networking

• The regional REN in eastern and southern Africa

• Non-profit association

• Head office in Lilongwe, Malawi

• Incorporated in 2006 in the Netherlands

• Now also incorporating in Malawi

8T E N E T

UbuntuNet MembersEb@le, DRC

EthERNet, Ethiopia

KENET, Kenya

MAREN, Malawi

MoRENet, Mozambique

RwEdNet, Rwanda

SomaliREN, Somalia

SUIN, Sudan

TENET, South Africa

TERNET, Tanzania

RENU, Uganda

ZAMREN, Zambia

9T E N E T

UbuntuNet’s London PoP• Located in Telecity, London

– since March 2008

• Member NRENs connect to the POP

• UbuntuNet interconnects with– Géant (The European regional REN)

– More than 300 peers at the London Internet Exchange (LINX)

– Transit purchased from NTT

• TENET operates the PoP for UbuntuNet

10T E N E T

What is SANReN?

11T E N E T

• South African National Research Network– DST funds capital cost– CSIR (Meraka) contracts with

suppliers and “owns” it– TENET operates it– Institutions bear operating costs

• 10 Gb/s Backbone ring– Commissioned 1 Dec 2009– Extensions planned to remote

PoPs

• Metropolitan access networks:– Johannesburg– Soon in Cape Town, Durban,

Pretoria

PTA

JNB

BFN

CPTPE

DBN

EL

12T E N E T

TENET’s SEACOM deal

13T E N E T

Mid 2007• Current Telkom contract nearing its end• Change is in the air…

– Electronic Communications Act replaces Telecoms Act– 2nd network operator licensed (Neotel); ISPs gearing up– UbuntuNet Alliance establishes London hub– Government envisages deploying national research

network

• TENET decides to– acquire engineering and service management capacity– operate its own routing infrastructure– call for tenders for underlying network capacity– Interconnect internationally via UbuntuNet

14T E N E T

Sept 2007

• SEACOM offers TENET 10 Gb/s circuit between Johannesburg and Sicily

• Indefeasible Right of Use for 20 years

• Commissioning planned for June 2009– 20 months away

• $23 million, payable upon commissioning

• Annual O & M charge of 3%.

15T E N E T

How do we find $23 million?

• Tried to raise loans from bigger universities– Complete failure

• Idea: Exploit the recurring bandwidth budgets!– $5.8 million p.a. being spent on international b/w– Can we pay for the IRU over 6 years?

• SEACOM says OK!– Option to pay in 6 equal annual payments– 14% p.a. financing charge

• SEACOM asks: What guarantees can TENET provide?

16T E N E T

Oct 2007

• TENET calls for “SEACOM CIR Bids”– Invitation to all institutions– Hey Mr. IT Director! How many “SEACOM Bid

Units” would you like?

• Each “Bid Unit” entailed– Preferential ordering rights for 10 Mb/s on SEACOM– Obligation to pay six annual amounts of $7,000– (Works out at < $60 per Mb/s per month)

• TENET obliged to repay in services or cash

• Breakeven point: 750 Units

17T E N E T

Outcome of Bid Process

• A NO-BRAINER!– 950 CIR Units bid– $29 million committed by 27 institutions

18T E N E T

Final contract

• SEACOM accepted the 27 Bids as sufficient guarantee

• Meanwhile negotiations continued…– Endpoints: Mtunzini and Telecity, London– Price: Drops to $20 million

• Capacity Purchase Agreement signed on 2 November 2007

19T E N E T

Later (just before commissioning)

Loan from the DBSA

• Development Bank of Southern Africa grants TENET loan of R154 million (equivalent to $20m).

• DBSA also accepted the 27 Bids as sufficient guarantee.

• Loan enabled TENET to fully pay SEACOM.

• Institutions’ annual obligations converted from US dollars to SA Rand.

20T E N E T

The advent of dark fibre• 1st Mtunzini Backhaul

– IRU purchased from Dark Fibre Africa– 160 km; 6 dark fibre pairs– 3 lambdas in use on one fibre pair– Signal amplification at Umhlanga Rocks– Was ready for SEACOM launch in Jul 2009

• TENET had required EC licenses

– Just in time– Thanks to Altech Autopage court rulings

21T E N E T

Mtunzini Backhaul

PTA

JNB

BFN

CPTPE

DBN

Mtunzini (landing station)

SEACOM cable

1st Backhaul: DFA

EL

2nd Backhaul: Neotel

22T E N E T

Further dark fibre projects nearing completion

• UZULU Main Campus (kwaDlangezwa)– 30 kms south to Mtunzini

• UNISA Campus in Florida– Redundant routes to Wits and Rosebank

• Wits Main - Wits Baragwanath – UJ Soweto– Spur shared by Wits and UJ

• Monash SA (Roodepoort)– Redundant routes to Wits and Rosebank– Amplification at UNISA Florida

23T E N E T

TENET needs

• Access networks in– Bloemfontein– East London– Nelspruit– Polokwane– Port Elizabeth– Vanderbijlpark

• Co-build partners….

24T E N E T